What is an urbanisation in Spain? An urbanisation (urbanización) is an urban demarcated residential area with residential character, often with communal facilities and services. While many buyers assume that a property within an urbanisation is by definition legally secure, this is incorrect. Without correct completion and permits, you run the risk of illegal situations, such as demolition orders or lack of rental licences. Thorough due diligence is therefore necessary.
What does a Spanish urbanisation legally entail?
From an urban planning point of view, an urbanisation is an area that is included in the local zoning plan (Plan General de Ordenación Urbana) is explicitly designated for residential purposes. However, it is crucial to distinguish between a planned urbanisation and a delivered urbanisation.
The pitfall of unfinished infrastructure
An urbanisation must be fully completed and handed over to the municipality. This process includes the completion of infrastructure such as roads, street lighting, green areas, sewerage and electricity networks.
If urbanisation not correctly delivered, two major legal risks arise:
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No certificate of conformity (LPO): The municipality may refuse the Licencia de Primera Ocupación (LPO) to be issued or renewed. Without this document, it is Legal rental to tourists impossible and utilities may refuse to provide services.
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Contingencies: The municipality may require owners to put the infrastructure in order at their own expense. This results in unexpected, high financial claims on top of your purchase price.
Expert Quote: "In practice, especially in the region around Estepona, we see even older urbanisations where the infrastructure has never been officially transferred to the municipality. The costs of asphalting roads or renewing sewers are then suddenly recovered from the unsuspecting new owner." - Glenn Janssens, Confianz.
The benefits of urbanisation in Spain
Choosing to live in an urbanisation offers specific advantages in terms of comfort and security, provided the legal basis is in place.
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Social control and security: A major plus is the presence of neighbours and social control. Even in the low season, there is often habitation, which reduces the chances of burglary or squatting. Many urbanisations are gated (gated communities) and have private security.
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Worry-free maintenance: You do not have to worry about the maintenance of common parts such as swimming pools, gardens and roads. This is outsourced to a professional trustee or administration office.
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Proximity to amenities: Urbanisations are often strategically located near commercial centres with supermarkets, pharmacies and restaurants, making daily life easier.
Read more about buying safely in Spain.
The disadvantages and risks: Forced co-ownership
The disadvantages of an urbanisation are similar to those of an apartment building in Belgium or the Netherlands. You step into a system of compulsory co-ownership, regulated by Spanish law Ley de Propiedad Horizontal.
Read more about co-owners' association in Spain.
1. Financial liabilities and debts
You are legally obliged to contribute to common costs (gastos de comunidad). It is no exception for an urbanisation to struggle with defaulters or past debts.
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Note: As a buyer, you can be held liable for outstanding community debts of the current year and the previous three years of the previous owner.
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Major planned works (such as renovating a communal swimming pool) can lead to high additional contributions.
2. Deterioration and management
When an owners' association (Comunidad de Propietarios) malfunctions, necessary works are postponed. This leads to degradation of the common parts, which is a direct negative impact on market value and marketability of your individual property. Be extra vigilant for 'ghost urbanisations': projects that were never fully completed after the 2008 crisis.
3. Conflicts and regulation
If there are common parts, an urbanisation has its own bylaws and internal regulations. These may state, for example, that holiday rentals are prohibited or that pets are not allowed by the pool.
Read more about the annual cost of a second residence in Spain.
Conclusion: Is urbanisation a safe buy?
An urbanisation in Spain offers comfort and social control, ideal for owners who do not have a permanent presence ("lock-up-and-go"). However, the risks are mainly legal and financial: from illegal infrastructure to community debts. These risks are manageable and avoidable, provided that an in-depth investigation into the licensing and financial health of the Comunidad.
Frequently asked questions about Urbanisations in Spain (FAQ)
Is it compulsory to pay community fees in a Spanish urbanisation? Yes, this is a legal requirement under the Ley de Propiedad Horizontal. As an owner, you have to contribute to the maintenance of common parts, insurance and facilities. In case of non-payment, the owners' association can have your property seized through legal proceedings.
How do I know if an urbanisation is legal and fully completed? You cannot see this just with the naked eye. You need to check whether the municipality has formally accepted the urbanisation (recepción de la urbanización). In addition, you should verify whether there is a valid Licencia de Primera Ocupación (LPO) or certificate of conformity is present.
Can I rent out my house in an urbanisation to tourists? Not always. First, the region must allow it and you need a rental licence (which often requires an LPO). Secondly, the owners' association (Comunidad de Propietarios) explicitly allow tourist rentals. Always check beforehand.
What is the difference between an urbanisation and a detached villa on 'suelo rústico'? An urbanisation is on 'suelo urbano' (building land) and has common facilities and rules. A villa on 'suelo rústico' (agricultural land) often stands alone, has no common costs, but often has stricter restrictions on conversions and legalisation.
About the author: Glenn Janssens is a lawyer specialising in Spanish real estate transactions and tax regulations. Since 2017, he has been helping Belgian and Dutch individuals and entrepreneurs to safely purchase and structure real estate in Spain. He guides files from A to Z: from due diligence, ownership and tax control to estate planning and optimisation for residents and non-residents. Thanks to his years of experience, hundreds of handled files and focus on transparent communication, Glenn makes complex Spanish legislation understandable and practically applicable for every property buyer.
